S. 2155: Keeping Gun Dealers Honest Act of 2025

The Keeping Gun Dealers Honest Act of 2025 aims to enhance accountability for licensed firearms dealers through a series of amendments to existing laws. Below is a summary of its key provisions:

Compliance Inspections

The bill proposes to increase the frequency of compliance inspections for firearms dealers from once to three times a year. This aims to ensure that dealers adhere to federal regulations concerning the sale and distribution of firearms.

Increased Penalties

Penalties for firearms licensees who violate laws will be increased. Specifically, the maximum imprisonment term for certain violations will go from one year to five years. The bill also introduces harsher penalties for recordkeeping offenses that facilitate gun trafficking, allowing for fines and prison sentences of up to ten years in some cases.

License Suspension and Civil Penalties

The bill grants the Attorney General the authority to suspend or revoke firearms dealer licenses and impose civil penalties of up to $10,000 for violations of the Gun Control Act. This can occur if a dealer fails to adhere to federal regulations or does not provide secure storage for firearms.

Termination of License upon Felony Conviction

It stipulates that if firearms dealers are convicted of felonies, their licenses will be terminated immediately rather than waiting for the conviction to be finalized.

Additional Personnel

The bill allows the Director of the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) to hire at least 80 additional personnel to facilitate the increased inspections mandated by the legislation.

Inventory Management

Licensed dealers may be required to conduct physical inventories and report them if there are unlawful transfers of firearms or if ten or more firearms traced to crimes are linked back to their inventory.

Issuance of Licenses

The bill empowers the Attorney General to deny applications for licenses based on potential dangers to public safety, or if an applicant is deemed unlikely to comply with the law.

Liability Standards

The standards for establishing liability for firearms dealers are revised to eliminate the requirement that violations must be willful, potentially making it easier to hold dealers accountable for infractions.

Biennial Reports

The ATF is required to submit biennial reports to Congress on the implementation and effectiveness of this Act, including recommendations for ensuring compliance and addressing noncompliance among firearms dealers.

Severability Clause

The bill contains a severability clause, ensuring that if any part of the Act is deemed invalid, the rest of the Act will remain in effect.

Relevant Companies

• Ruger (RGR) - A firearm manufacturer that may face increased scrutiny and compliance requirements under this legislation.
• Smith & Wesson (SWBI) - Another firearms manufacturer that could be impacted by heightened inspection frequency and stringent penalties for compliance failures.
• Axon Enterprise (AXON) - This company provides law enforcement technology and may have indirect impacts related to changes in firearms regulations.